Correlating Medicaid Reimbursement Reductions, the Sustainability of Providers, and Access to Care Utilizing Healthcare KPIs

Abstract

Do reimbursement rates to Medicaid providers correlate with their Medicaid participation rates? That is, will Medicaid reimbursement rates dictate trends in provider Medicaid participation because of fiscal stability in their payor portfolios? The implementation of the Medicaid Primary Care Payment Increase as part of the initial ACA rollout proved to be a murky testing ground for this thesis. In part, the short-term increase coupled with states’ delayed implementation retarded any large effects of such increases. Nonetheless, the consensus was positive, and the increase prompted more enthusiasm to participate in Medicaid programs and increase access to care (RAND Corporation, 2017). In states opting into Medicaid expansion in the Affordable Care Act (ACA) program, the answer was initially not clear (MACPAC, 2018). Nonetheless, Medicaid provider participation has not seen a systematic national drop – it has stabilized around an average 70% mark for several years into the ACA implementation. However, states’ Medicaid reimbursement rates differ and there are microeconomic correlations pointing to the effect of lower Medicaid reimbursements in state regions. This paper will focus on microeconomic key performance indicators (KPIs), that may empirically dictate the effect of reimbursement rate reductions in Medicaid on provider business stability and patient access to care epiphenomena.